Suzlon Energy announced signing of order of $1.28bn for 1000MW with subsidiary of Caparo Energy-to be developed by 2013

As Panchabuta has earlier discussed, Caparo Energy, a Guernsey company that is the holding company for subsidiaries (together, the “Group”) that seek to generate wind power in India.

Caparo Energy is focused on becoming one of the leading independent power producers in India and is seeking to generate predictable and long-term cash flows by building up a portfolio of wind power generating assets in the Indian wind energy market. The Group intends, in due course, to acquire and develop a portfolio of wind farms with a target total annual installed capacity of up to 5,000 MW, which it intends to develop in two concurrent phases: Phase I consisting of 3,000 MW with a target completion date of 2016; and Phase II consisting of 2,000 MW with a target completion date of 2017.

For Phase I, the Company, through its subsidiary Caparo Energy (India) Limited (“Caparo Energy India”), has entered into a business partnership agreement with Suzlon Energy Limited (“Suzlon”), one of the world’s leading wind turbine generator manufacturers, to acquire up to 3,000 MW of wind power generation farms.

For Phase II, Caparo Energy India is in advanced discussions to acquire land and turbines from international vendors in connection with wind power farm development in wind-rich states in India, including Karnataka, Maharashtra, Tamil Nadu and Andhra Pradesh.

Panchabuta has earlier this year mentioned that  Caparo Energywas in discussions with Suzlon that are are ongoing and the board looks forward to announcing the details of the first purchase orders early in the new year. Panchabuta, had talked about this in an earlier report in may this year.

According to reports today, Suzlon Energy Limited (SEL) announced the signing of an order with Caparo Energy (India) Limited (CEIL) for 1000 MW of wind power projects to be developed in India progressively by March 2013.

CEIL is a wholly owned subsidiary of AIM listed Caparo Energy Limited (CEL) and is focused on becoming one of the leading Independent Power Producers (IPP) in India with a thrust on wind energy.

Angad Paul, Non-Executive Chairman – CEL, said: “India’s energy market is one of the world’s most buoyant. With the supportive regulatory framework for wind energy, we see a great opportunity to invest as an IPP in what is the world’s fifth largest wind energy market.Recent improvements in the regulatory framework, such as the revised Feed-in Tariffs,Renewable Purchase Obligation (RPO), Generation-based Initiatives (GBI) and Renewable Energy Certificates (REC), give us an opportunity for value creation using a combination of various revenue options. We are happy to have Suzlon’s expertise, as Asia’s leading wind power player, in our endeavor to become a major wind power IPP”.

Mr. Ravi Kailas, Chief Executive Officer – CEL, said: “We are committed to becoming a major player in the Indian wind power market and, it is key for us that our partner matches our ambition with capability and expertise. With Suzlon, we believe we have the best lifecycle value contribution, allowing us to rapidly build up bankable, profitable wind power projects”.

Panchabuta, has earlier talked about the  Generation Based Incentives (GBI) scheme for grid connected wind power projects with the objective of broadening the investors base by attracting FDI and independent power producers.

During FY11, the country is likely to add close to 2,200 MW of new wind capacity according to officials and around 450 MW is expected to be covered under GBI. The Generation Based Incentive Scheme (GBIS) provides that the energy producer will be entitled to an incentive payout of INR0.50 per unit of electricity fed into the grid.


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